Alibaba Sells Majority Stake in Sun Art to DCP Capital for $1.6 Billion
Alibaba sells its 78.7% stake in Sun Art Retail for $1.6 billion after a sharp stock surge, signaling a strategic pivot to strengthen its e-commerce dominance.
Alibaba Group has decided to sell its majority stake in Sun Art Retail Group, one of China's largest hypermarket chains, to private equity firm DCP Capital. The deal, valued at HK$12.298 billion ($1.58 billion), includes a 78.7% stake owned by Alibaba’s subsidiaries, as revealed in a filing with the Hong Kong Stock Exchange.
Alibaba acquired its controlling stake in Sun Art in 2020 for $3.6 billion, aiming to merge its digital capabilities with the hypermarket’s operations. However, after a remarkable 85% rise in Sun Art's stock price over the last year—far exceeding the Hang Seng Index’s 20% gain—the company has opted to sell its stake.
This isn't the only asset Alibaba is letting go. The e-commerce giant is also divesting its Chinese department store unit, Intime, even if the sale results in financial losses.
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These moves highlight Alibaba’s strategy to simplify its business operations and concentrate on its main strength: e-commerce. By shedding non-core assets, the company aims to adapt to market changes and strengthen its position in China's competitive digital economy.
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